All is well in California, according to Gov. Gavin Newsom. The milk flows cool and creamy, and the honey has never been so sweet. But beneath the bluster lies bitter experience and, if nothing changes, a sour future. 

The Golden State, says the presidential aspirant in a recent co-bylined op-ed published by Project Syndicate, offers policy predictability, a welcome home for global capital, and a green agenda like no other. 

Newsom is correct in that policy is predictable in California. But that’s no virtue when policy is expected to always move in a single direction — toward weightier regulation, more punitive taxes, and a general tendency toward increasing government intervention in private matters. This has produced a state with stagnant employment, hostility toward business and enterprise, rising energy prices, unaffordable housing, and a cost of living that has sent residents fleeing to states where they have more freedom to pursue their happiness. 

Newsom is also right when he points out that the state has one of the largest economies in the world. It’s either fourth or fifth, depending on who is doing the counting. But the Newsom economy has struggled.

In 2021, California’s share of the domestic economy was a record 14.5%. By the second quarter of 2025, though, it had slipped to 13.8%, and today is being propped up by the valuations of a few artificial intelligence companies and legacy tech firms such as Apple, Alphabet (Google), and Meta (Facebook) that haven’t fled (yet) as so many other companies have. 

At 2%, nonfarm job growth from February 2020 to December 2025 was less than half the rate that the rest of the nation experienced at 4.3%. The jobs record is even worse in the private sector, which drives innovation and fosters prosperity. While the rest of the country grew private-sector jobs by 4.8% over the same period, California’s growth was an anemic 1.8%. 

Anticipating that the job climate is likely to degrade further would not be unreasonable. Employers have been leaving California for states with lower taxes and less regulation.

Most recently, Yamaha “ditched California after 50 years for Georgia,” joining Oracle, Charles Schwab, Chevron, Tesla, SpaceX, Hewlett-Packard, Toyota Motors North America, and several other high-profile employers in quitting the state. Apparently, Yamaha is convinced it will be able to improve its “asset efficiency” and enhance its “profitability in the United States,” where business conditions are less hostile than they are in California. 

Residents have given up, as well. California has gone through the biggest net outflow of people in the country for six straight years. The last time the state gained more residents than it lost to other states was 2000. The largest net loss was in 2021, when Newsom was mishandling the pandemic. The net deficit was nearly 400,000 that year. 

Meanwhile, energy prices keep bringing the pain. Real residential electricity rates soared by 39% from 2019 to 2025, the highest increase in the country, says the Energy Institute at the University of California, Berkeley, Haas School of Business. Gasoline prices are just as outrageous. In early February, before the U.S. and Israel began military action against the Iranian regime, only Hawaii, at $4.40 a gallon, had more expensive gasoline than California, where it was barely lower at $4.39 a gallon. By Monday, regular unleaded averaged $5.79 a gallon in California, the highest in the country.

Going back just a few years, to 2022, the year Newsom was reelected, “Californians paid a record $2.61 more per gallon than the national average,” says the state’s own data. By late last year, the gap had fallen to $1.55 a gallon, but it was still the widest in the nation. 

Driving one of the EVs that the governor has forced on Californians provides no relief from painful energy prices. At 45 cents per kilowatt hour, the Golden State is one of the most expensive states for electric vehicle charging. 

Some Californians can afford the steep energy prices. And it’s their wealth that makes the state’s per capita gross domestic product look like a solid number. But the state, despite all its billionaires, still has the highest supplemental poverty measure in the nation, tied at 17.7% with Louisiana. Unlike the traditional poverty measure, the SPM takes into account government benefits and “necessary expenses” such as housing and taxes, both of which are exceedingly costly in California. 

None of this is to say that California doesn’t still have a lot to boast about. It does. But it’s lost its luster due to decades of abysmal public policy. The governor has had seven years in office to make the needed repairs, but writing gaslighting op-eds is more important.

— Written by the I&I Editorial Board